Several U.S. and foreign intelligence sources, along with investigators, say an Iranian exile with ties to Iran-Contra peddled a bizarre tale of stolen uranium to governments on both sides of the Atlantic in the spring and summer of 2003.

The story that was peddled -- which detailed how an Iranian intelligence team infiltrated Iraq prior to the start of the war in March of 2003, and stole enriched uranium to use in their own nuclear weapons program -- was part of an attempt to implicate both countries in a WMD plot. It later emerged that the Iranian exile was trying to collect money for his tales, sources say.

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By all credible accounts, the source of this dubious tale was Manucher Ghorbanifar, an Iranian arms dealer who used middle-men and cut-outs to create the appearance of several sources. Ghorbanifar played a key role in the Iran-Contra scandal that threatened to take down the Reagan administration, in which the U.S. sold arms to Iran and diverted the proceeds to Nicaraguan militants.

While the various threads of the larger story of Ghorbanifar and his intelligence peddling began in December of 2001, meetings in Paris in 2003 are far more important in illustrating -- as a microcosm -- the larger difficulties faced in untangling the facts relating to global intelligence trafficking.

Tall Tale of Uranium

During the spring and summer of 2003, Congressman Curt Weldon (R-PA) made several visits to Paris to meet with a source believed to have important military intelligence information.

Unbeknownst to Weldon, the informant, who he would dub simply "Ali," was already peddling a tale of stolen uranium traveling between Iraq and Iran that had been deemed false by most intelligence agencies.

As reported by American Prospect and confirmed by intelligence sources, Ali is a pseudonym used to identify a former minister in the Shah's Iran, Fereidoun Mahdavi. Mahdavi himself is a secretary to Ghorbanifar, the originating source of the uranium fable.

The American Prospect's reporters wrote, "'Ali' is actually a cipher for Manucher Ghorbanifar, the notorious Iranian arms dealer and accused intelligence fabricator -- and the potential instrument of another potentially dangerous manipulation of American policy in the Persian Gulf region."

The Washington Post discusses Ali as follows: "'These secrets,' he says, come from 'an impeccable clandestine source,' whom Weldon code-names 'Ali,' an Iranian exile living in Paris who is a close associate of Manucher Gorbanifar. Gorbanifar is a well-known Iranian exile whom the CIA branded as a fabricator during the 1980s but who was used by the Reagan White House as a middleman for the arms-for-hostages deal with Iran."

According to several intelligence sources on both sides of the Atlantic, the tale that "Ali" tells Weldon and others was as intricate as it was false.

"Ali provided information that indicated Iranian intelligence had sent a team to Baghdad to extract highly enriched uranium (weapons grade) from a stockpile hidden by Saddam Hussein," one intelligence source said.

Ali asserted that an Iranian intelligence team had infiltrated Iraq prior to the start of the war and stole enriched uranium to use in their own nuclear weapons program, sources say.

Ghorbanifar said "the team successfully extracted the stockpile but on the way back to Iran contracted radiation poisoning," one source remarked.

Upon learning this information Weldon says that he immediately notified then-CIA director George Tenet.

"Tenet appeared interested, even enthusiastic about evaluating Ali and establishing a working relationship with him," Weldon wrote in his book, Countdown to Terror. "He agreed to send his top spy, Stephen Kappes, the deputy director of operations, along with me to Paris for another debriefing of Ali.

"On the day of our scheduled second meeting with Ali in Paris, Kappes bowed out, claiming that "other commitments" compelled him to cancel," Weldon continued. "Later, the CIA claimed to have met with Ali independently. But I discovered this to be untrue... Incredibly, I learned that the CIA had apparently asked French intelligence to silence Ali."

But according to the Prospect and several sources in intelligence abroad, the CIA did investigate, as did the Department of Defense. According to the Post, the agency tasked then-Paris station chief Bill Murray with investigating the claim, who ultimately found Ali to be a "fabricator."

The CIA, understanding Ali to be Ghorbanifar, did not think him a credible source.

Intelligence sources and a source close to the UN Security Council tell RAW STORY Murray took Ali (either Ghorbanifar or his agent) to Iraq in order to retrace the footsteps of the alleged mission in which the uranium was stolen from Saddam's own stockpile and taken back to Iran. In the end, sources say, the entire event proved a wild goose chase because Ali's earlier clarity all but evaporated.

"Soon it became apparent that Ali and his sources were fabricators and were trying to extract large sums of money," one intelligence source said.

Murray says he did meet with the source, but was not part of a trip to Iraq.

"I did not make any such trip," Murray said. "I met with the source, found that he was not credible, forwarded the information he gave us to Washington, where it was thoroughly analyzed by many people and found not to add anything new to what we knew about Iran. The sensational charges that the source made could not be substantiated."

Weldon's office declined to comment for the record after several extended conversations. RAW STORY delayed the article for a day to give Weldon's office a chance to comment.

The neoconservative movement has long expressed an inherent distrust of the CIA. Many neoconservatives note that the agency undercounted Russia's nuclear stockpile in the waning days of the Soviet Union, and believe that it routinely underestimates foreign threats.

Weldon, who had been led to believe the CIA never opened an investigation into the information he provided, took his case directly to Secretary of Defense Donald Rumsfeld. Rumsfeld then pressured the CIA to investigate further.

"CIA reluctantly, after pressure from Rumsfeld, followed up by detaching one of their weapons experts from the team that was hunting WMD in Iraq," one former CIA officer who asked to remain anonymous said.

Sources say that this second investigation resulted in another wild goose chase. The question of motive, however, seems to either have been entirely missed or simply glossed over.

Weldon seen caught in web

By all accounts, Weldon seems to be more of an innocent bystander taken in by an internationally known con-man and the lure of spook-like activities than an inside player with an agenda or material participant in these events.

The Ali composite seems to have used Weldon as a conduit by which to provide the CIA with information.

There was good reason to be cautious of Manucher Ghorbanifahr, who, along with his secretary, made up the "cipher" of Ali.

The CIA had already had issued two burn notices against Ghorbanifahr as early as 1984 and his role in Iran-Contra as a middleman between the hardline neoconservative and another Iran-Contra figure, Michael Ledeen.

In his book, Weldon said he met Ghorbanifahr after being approached by a Democratic congressman.

"On March 7, 2003, a former Democratic member of Congress and my good friend Ron Klink called and asked to meet with me. . . . The source was Ali. My contacts with him were at first by telephone. Subsequently, Ali sent faxes to my home on a regular basis from different hotels in Paris, where he lives in exile. Eventually, as the information became more detailed and critical, I decided on a face-to-face meeting." (Countdown to Terror, p. 4).

Why such highly important information would be provided to Klink and then Weldon as opposed to the chairman of the House Intelligence Committee remains unclear.

Neoconservative Leeden explains meetings

Ghorbanifahr has strong ties to Michael Ledeen, and both of them were involved in a controversial meeting in Rome of 2001. That meeting, whose purpose is unknown, included high level officials in Italian intelligence, Iranian nationals and Larry Franklin, a former Defense Department analyst who current pled guilty to charges of passing classified information to Israel and Iran. Also in attendance was Middle East expert Harold Rhode, also under investigation for charges of passing classified information to Israel and Iran. Both Rhode and Franklin worked for Feith in the Office of Special plans.

Ledeen was consulting for OSP when all three were dispatched to Rome in 2001. He says the meetings had nothing to do with Iraq.

"The Rome meetings had nothing whatsoever to do with Iraq, but with Iran and Afghanistan," Ledeen wrote in an email. "I don't think a single word was pronounced, by anyone, on Iraq."

Later, in a phone conversation, Ledeen explained that the Rome meeting had to do with what his sources told him was going on on the ground in Afghanistan, namely that Iran was allegedly fueling the Afghan insurgency.

According to James Risen's New York Times article dated December of 2003, Ledeen was a paid consultant to the National Security Council at the time of the meeting. Risen reports that National Security Advisor Stephen Hadley was informed of the plans for the meeting and that Hadley expressed reservations given Ledeen and Ghorbanifahr's background.

The Office of Special Plans, however, authorized the meeting without notifying any other agency, violating protocol. They did not notify the Rome CIA station chief or the U.S. Ambassador to Italy, Mel Sembler.

Ledeen, however, says that Hadley had authorized the trip. This would also implicate Secretary of State Condoleezza Rice, then-National Security Advisor.

"Hadley authorized it and he could not have done so without reporting it to his direct superior," said Ledeen.

Ledeen also denies that he had anything to do beyond that first meeting in December of 2001.

"I was involved in one meeting, in Rome, in December 2001," Leeden said. "Period."

Paris, Again

The uranium story peddled to Weldon is strikingly similar to the story told to Ledeen.

"I approached a variety of government officials, lots of them, and told them that I had a reliable source that told me about how and where the Iranians stole enriched uranium from Iraq," Ledeen said.

Ledeen says his source then went on to explain that the "stash" was buried in an underground facility and recounted, much like Weldon did, that neither the CIA, the Defense Department or the State Department would listen to his concerns.

Asked if his source was Ghorbanifahr, Ledeen said "No," but was unable to tell the identity of his source for fear said source might be "put in danger."

Who arranged the meetings and their ultimate purpose remains unclear. One intelligence official, however, described the series of events and the market of intelligence trafficking as follows: "If you were going to launder intel to make up a war, you could easily send some fool on an errand."